Inside the numbers that led to CaaStle's fraud allegations
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Christine Hunsicker, the founder and now-former CEO of fashion tech company CaaStle, isn't just being accused of fudging some numbers. It sounds like she may have built an entire Wonka factory.
Zoom in: Axios has learned that Hunsicker last year told prospective investors that CaaStle generated $519 million in 2023 revenue. Audited financials sent on Saturday to shareholders show the actual revenue figure for the year ending Sept. 30, 2023 was only $15.7 million.
But wait, there's more:
- Prospective investors also were told that fiscal 2022 revenue was $278 million, when it actually was $19.7 million. Projections for 2024 and 2025 revenue were $793 million and around $1 billion, respectively.
- Hunsicker also claimed that 2023 EBITDA was $91 million and virtually flat in 2022. The audited financials don't specifically include EBITDA, but do show a combined $135 million net loss for the two fiscal years with less than a combined $25 million for interest, depreciation, and amortization.
- Finally, prospective investors were told that CaaStle had hundreds of millions of dollars in cash as of mid-2024. If so, that's a heck of a trick. It ended Sept. 2023 with less than $1 million in cash and around $3 million in total assets, and then raised just under $60 million in subsequent funding.
It's unclear if all prospective investors and shareholders received the same information, or if different data went to different audiences.
Catch up quick: Axios on Monday was first to report that Hunsicker has resigned as CaaStl's CEO, after being accused by the board of financial misconduct.
- The company has raised over $530 million in venture capital, but now is nearly broke and just put all employees on a two-week furlough while it decides next steps.
Meanwhile, P180 is trying to distance itself from Hunsicker, who recently co-founded the retail acquisition platform with industry vet Brendan Hoffman.
- In a statement, Hoffman says: "I am both shocked and saddened by the recent developments at CaaStle. Christine Hunsicker has stepped down as Chairman of P180 which operates as an independent entity. Our primary focus moving forward is to nurture and grow Vince Holding Corp. and support our investment in Altuzarra."
Still no comment from Hunsicker.
